Shadow transactions in Ukraine account for 23.8% of official GDP – study

The share of the shadow economy in 33 countries varies between 10.1% and 26.9% of GDP.

Photo from zn.ua

Photo from zn.ua

Shadow transactions in Ukraine account for 23.8% of official GDP, or UAH 846 billion, or $US34.60 billion, according to a study.

The study was conducted by Ernst & Young with the support of Mastercard as part of a memorandum with the Ministry of Economic Development, Trade and Agriculture of Ukraine, the State Statistics Service of Ukraine, and the National Bank of Ukraine (NBU), the latter said on its website.

Read alsoUkraine's economy minister presents economic growth strategy

The study conducted in 33 countries, including the Czech Republic, Poland, Slovenia, Slovakia, Croatia, Bulgaria, Bosnia and Herzegovina, Serbia, reveals that the share of the shadow economy ranged from 10.1% to 26.9% of GDP.

At the same time, the cash-based shadow economy in Ukraine accounts for 19.7% of GDP, while 4.1% of GDP is domestic production for own use, that is, a non-monetary shadow economy.

According to previous studies in European countries, an increase in the share of cashless payments by 100% helps to reduce the shadow economy by 0.6-3.7% of GDP, and government revenues grow by 0.1-0.8% of GDP.

As UNIAN reported earlier, the number of transactions using payment cards in Ukraine in 2019 compared with the previous year increased by 29% to 5 billion units, and the volume of these operations rose by 24%, to UAH 3.6 trillion (US$147.2 billion).

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